Thursday, October 22, 2009

Report from the HRG Smart Growth Conference

It went quite well. Thanks to those of you who plowed through the rain to attend. If you're interested in some of what was said, the Land Use Prof Blog has a report. I'm also hoping to link to some of the charts and video when it's up. But in the meantime, here are a few of my observations and a portion of my intro speech:

Sam Staley from Reason went in depth on how land use regulation works in other cities vs. Houston. The bottom line difference was staggering: 3-4 months for development approval here vs. 2-4 years elsewhere! And that time difference adds massive uncertainty, risk, and costs.

Commissioner Todd Staples said Texas has the highest productivity per person and GDP per person vs. any nation. While I believe that's in the ballpark, I'm not sure that includes some of the smaller, super-wealthy countries like Norway, Luxembourg, or even Switzerland (not to mention some other states). But impressive nonetheless.

Wendell Cox pointed out that, on a global basis, the most sprawling cities have the shortest average commutes, with access to more jobs and higher productivity. Some of the most dense cities, like Hong Kong, NYC, and Sydney, had the longest average commutes.

Luis Vera of San Antonio LULAC spoke out against the inherent minority discrimination in smart growth policies, including home unaffordability and diverting transit resources from buses to rail.

Mike Inselmann of Metro Studies had data showing Houston is currently the #1 metro in the country for homebuilding, followed by DFW and then dropping off rapidly in other metros.

“Smart growth is an urban planning and transportation theory that concentrates growth in the center of a city to avoid urban sprawl; and advocates compact, transit-oriented, walkable, bicycle-friendly land use, including neighborhood schools, complete streets, and mixed-use development with a range of housing choices. Smart growth values long-range, regional considerations of sustainability over a short-term focus. Its goals are to achieve a unique sense of community and place; expand the range of transportation, employment, and housing choices; equitably distribute the costs and benefits of development; preserve and enhance natural and cultural resources; and promote public health.”

Kinda hard to argue with? Doesn’t sound too bad? It’s a siren song that has certainly attracted a large number of communities across the country. But they have not only found that it requires extremely intrusive government control and intervention in markets to get the desired outcomes – something that seems to run against the grain of our American charter based on freedom – but it also has created many unexpected negative side effects, the most painful being the loss of affordability (from housing supply restrictions) and the price bubble that led to the recent crash. The loss of home affordability has been particularly hard on poor and minority communities. Dr. Edward Glaeser at Harvard has built a substantial academic reputation exposing these affordability problems from excessive government regulation, ironically from some of the supposedly most progressive governments. One study from the University of Washington found that regulations added $200,000 to the median price of a home in Seattle.

Additional smart growth ramifications include:

Costly transit investments, particularly light rail, with low ridership that fail most cost-benefit calculations and often financially hobble their transit agencies, forcing painful bus service cutbacks on the most vulnerable transit-dependent populations.

Inadequate road investments leading to rapidly worsening traffic congestion and gridlock, along with increased air pollution.

Increased taxes to afford the needed development subsidies, transit investments, and infrastructure upgrades to accommodate increased densities in areas not designed for it.

Houston has been lucky to avoid most of these fads and problems, and has remained the most affordable major metro in America. Just one data point from Coldwell Banker: the equivalent of a $155K house in Houston would cost $357K in Denver or Portland and $536K in smart-growth paragon Boulder.

Here a few of my own related observations from my blog:

Growth is good. Despite the hidden anti-growth attitude in smart growth, studies of cities show that a doubling of population is accompanied by more than a doubling of creative and economic output. The larger the population of a metro, the greater the innovation and wealth creation per person.

People want space. Sprawl is not evil. Throughout history, even going back to the medieval nobles and their country estates, people have always desired more personal space as they have grown more affluent. Make this space unavailable by forcing density through regulation or inadequate transportation, as in Europe or Japan, and not only does housing become unaffordable, but fertility rates will drop below replacement levels as families shrink. If they can’t increase the size of their home, they will shrink the size of their household, which creates a financially destabilizing demographic implosion.

Density has limited appeal. As young people push marriage later, we have a new twenty-something stage of life where people want to live in a dense, vibrant, urban core. But, inevitably, as they marry and start families, space, cost, and school concerns draw them to the suburbs. Cities should absolutely offer good urban lifestyle options to those who desire it, but it will always be a relatively small part of our population.

People cannot be forced into the dense core or on long commuter transit rides against their will. If people can’t access nice, affordable homes and good schools within a reasonable commute, employers will move out to suburbs, leading people to move even further out, expanding sprawl, and draining the core’s tax base.

Most southern cities, like Houston, have a pedestrian-hostile tropical climate several months of the year. While northern transit-based cities benefit from a personal warming technology – the coat – the only personal cooling technology that exists for southern cities is an air-conditioned vehicle.

Cities that are hostile to the car will stagnate. The car is now a permanent part of our culture. Busy lifestyles require its comfort, speed, and convenience – but the propulsion technology will change to be greener and more energy efficient. This represents the future for the vast majority – not dense, transit-oriented living.

Planned density almost always fails. Planners try to protect low-density areas and designate high-density ones, but, inevitably, NIMBYs protest and shoot down the high-density development if there is a regulatory mechanism for them to do so – like a zoning board they can influence. Recent data shows that Houston’s free market approach builds one-third more density per capita than Portland’s highly prescriptive, planned approach. And a recent ULI advisory panel was emphatic in recommending that Houston not adopt zoning.

Commuter rail rarely works in a post-WW2 car-based city. Old cities in Europe and America were built with dense cores for the primary mobility mode of the time: walking. Rail allowed people to move to the suburbs and still commute to the single dense core of jobs (like Manhattan or downtown Chicago). Newer, mostly post-WW2, car-based, Sunbelt cities like Houston have decentralized jobs spread over many different centers, like downtown, uptown, the medical center, Greenway Plaza, the Energy Corridor, Westchase, Greenspoint, Clear Lake, and more. Less than 7% of our jobs are downtown. Trying to connect commuters to these job centers with rail would not only be astronomically expensive, but would lead to impractically long commute times with multiple transfers and long walks for people to reach their final destination buildings. Instead, there is a better commuter transit solution for these types of cities: frequent nonstop express buses and vanpools in managed lanes that whisk commuters directly to their job center and then circulate to get them right to their building without transfers, waits, or long walks in unpredictable weather.

These speakers today will outline what has worked and what has not with smart growth. I’m hoping this can help us make improvements to define a vision for a “Smart Growth 2.0”. One that, for instance, enables popular new urbanist developments by removing barriers and regulations rather than adding them. With that context, let me move on to our speakers.

As a someone in this "twenty-something stage of life" I fully agree with you that urban density is a big appeal that would not be true if I had a family.

Though I think we are not the only ones. Many "empty nesters" those that have all adult children (who are not living at home) often want something different than the suburbs. Many move to the country side, and many move inside the city because they have the income to afford it, and need less space.

As people live longer I think this will make up a huge group that will prefer an urban environment.

On density and empty nesters: there are some cases, but they are relatively rare. According to the data, the vast majority retire in-place, which makes sense: that's where they've built up their relationships, with ties to churches, etc., and it's where their kids want to visit. An overlooked factor is they want plenty of room for both their kids and grandkids to visit. That tends to preclude urban apartments/condos. The second most popular option is moving out to the country. Choosing urban living is still pretty rare.

I'm not sure what kind of hack said that smart growth reduces fertility rates, but you have to stop listening to him, now.

The highest-fertility developed country, Israel, is also one of the densest. The next highest-fertility is Ireland. The next is the US, followed by France.

The real reasons Americans have more children than most Europeans and East Asians: lack of easy access to birth control, leading to higher teen pregnancy. Large religious and immigrant subcultures with high birth rates (this is very prominent in Israel). Relatively high acceptance of working mothers. Go to Southern Europe or Japan or Korea, and you'll see that on the one hand even religious people practice birth control, but on the other working mothers are severely discriminated against.

I'm not inventing anything here. Everything I've just said has been remarked upon by people who do research on gender, fertility, and birth control, and publish it in peer-reviewed journal. Here is one study comparing South Korea and Taiwan. Here is a book discussing low fertility in East Asia, arguing that it's a direct result of government efforts to reduce population growth beginning in the 1960s. The people writing those studies, being not completely insane, don't even think of going on a Cox-style crusade against urbanism.

Besides credentials, the people in the article make no sense. They talk about how birth rates were low in the 1930s because it was hard to find housing; but it was no harder than in the previous decades, when birth rates were very high. They say nothing of how in Japan the highest birth rates are in Tokyo, or how Spain has both high home ownership and low birth rates.

AWP: the answer is, a lot. It's already starting to happen in New York. New York public schools are still considered bad, but private school tuition is now not much higher than per-student spending at high-income suburban public schools.

That's true; however, at least in New York, the suburbs have higher taxes than the city. If you're rich but not super-rich - say, with an annual income of $200,000 a year - it may be cheaper for you to pay city income taxes and private school tuition rather than suburban property taxes.

On a completely different note: whichever speaker at the conference said Texas ranks first in the world in GDP per capita is wrong. Even in the US, Texas ranks slightly below average.

Yes, he was excluding all the other states. Just pretending Texas was a country and comparing it to other countries. The US is so far ahead of even developed nations that TX can be slightly below average among states and still first among nations.

Two caveats: I think this was purchasing power adjusted, and probably based on the year of peak oil and gas prices.

About Me

Social Systems Architect and entrepreneur with a genuine love of my hometown. I cover a wide range of topics in this blog - including transportation, transit, economic development, quality-of-life, city identity, and development and land-use regulations - and have published numerous Houston Chronicle op-eds on these topics. I'm a Founding Senior Fellow with the Center for Opportunity Urbanism and co-authored the original study with noted urbanist Joel Kotkin and others, creating a city philosophy around upward social mobility for all citizens as an alternative to the popular smart growth, new urbanism, and creative class movements. I am a native Houstonian, 6th-generation Texan, attended Rice University for my BSEE and MBA, and a former McKinsey consultant and adjunct faculty member with Leadership Houston. I am currently the founder of Coached Schooling, pioneering a transformational new approach for a more effective and engaging 21st-century K-12 education combining the best elements of eLearning, home and traditional schooling. CONTACT EMAIL: tgattis (at) pdq.net - send me an email if you would like to receive these posts via email, or see the Google Groups signup box below.